Jobless Claims Rise in Easter Holiday Week

The nation's slowly improving employment situation took a minor setback as initial jobless claims jumped by 24,000 to 484,000 for the week ending April 10, and continuing claims also surged by 73,000 to 4.64 million, the U.S. Labor Department announced Thursday. However, the week's data was probably skewed higher by the Easter holiday and other one-time factors.

Separately, the Empire State Manufacturing Index surged 9 points to 31.9 in April, the New York Federal Reserve announced Thursday. Readings above zero indicate manufacturing activity is strengthening, while those below zero suggest a contraction. A Bloomberg survey indicated that experts expected the Empire State Index to rise to just 25 in April.
Emergency Unemployment Compensation Claims Are Also Up

Returning to employment data, a year ago, initial jobless claims totaled 609,000, continuing claims totaled 5.92 million, and the four-week moving average was at 636,250.

Regarding jobless claims, economists view the four-week average as a better indicator of unemployment conditions, as it smooths out anomalies from strikes, holidays and other idiosyncratic events.

Economists also monitor the continuing claims stat because it provides a snapshot of how long it's going to take the typical person to find comparable employment after sustaining a job loss. In general, continuing claims above 3 million reflect a slack labor market, and point to extended job searches of six to nine months or longer.

Also, states reported 5.86 million persons claiming Emergency Unemployment Compensation benefits for the week ending March 27 -- the latest week for which data is available -- an increase of 267,817 from the prior week. A year ago, there were 2.15 million EUC claimants.

Investors should put this week's employment report in the category of a "mulligan" -- a golfing term that means "we won't count that last shot." The reason? The Easter holiday, which undoubtedly skewed the data. Assuming that initial jobless claims and continuing claims resume their downward trend in the weeks ahead, the recovery narrative on the job front will remain in place.